Entries Tagged 'Greg Neitzert' ↓

It’s NO misconception we are getting hosed on the Downtown Parking Ramp

God Bless Him! You can’t ever deny that Councilor Neitzert really digs in his heels when it comes to issues facing our city and does his research. He sent out this press release explaining the 12 misconceptions of the parking ramp debate. While I agree with him on some of these, the problem is that Greg gets so lost in the weeds on the finer details he misses the ‘Big Picture’ and doesn’t answer many key questions, mainly “Why are we subsidizing the building of the Hotel?” AND “Why are we signing a contract with Aaron Hultgren before his OSHA fines and legal problems are settled?”

But let’s take a finer look at what Mr. Neitzert came up with;

Misconception #1: The parking ramp cost has increased

Reality: This is the first time we have a specific project with a detailed design with a concrete number we can be confident in.  All previous estimates were just that – estimates based on theoretical assumptions and ballpark figures for planning purposes only, and many only included construction only costs.  Comparing this final project plan to previous conceptual projects is not appropriate.

While that is true, many want to know why some of these ‘ballpark’ figures were off by over 50%? That is either lazy or incompetent government at it’s worst.

Misconception #2: Tax dollars will be used to fund the project

Reality: The parking division, like our water, sewer, and landfill divisions, is an enterprise fund.  This means it gets 100% of its funding from user fees – in the case of the parking division parking meters, leases on ramps and parking lots, and fines.  Likewise, 100% of its expenditures come from user fees.  No general sales tax or property tax dollars can be used to fund the system.  Your property and sales tax dollars will NOT pay for this ramp.

True, the bonds will be paid for by user fees (and the 2nd penny if the enterprise fund runs low). But the real misconception here is that DT employers are going to be able to just float or eat those additional costs for parking for their employees. Those costs will be passed onto their consumers in higher prices for their products and services. All costs get passed on. It’s the left pocket, right pocket argument, is it a tax or a fee? IMO, any time government charges you for a service, that’s a tax.

Misconception #3: Rates for parking meters and leases of parking will have to be increased to pay for this ramp

Reality: Rates were already adjusted two years ago so that the parking enterprise collects enough revenue to fund operations, repair and maintenance, and capital cost to replace or add new parking ramps.

Greg must have missed the email from the council’s legislative and budget analyst showing that rates will be increased over the next 10 years. Maybe he needs to check his email box.

Misconception #4: The parking division cannot afford the debt service on this ramp

Reality: The parking division has no debt currently.  Stress testing scenarios and a detailed financial analysis have been performed on the system.  Even with a loss of major tenant’s downtown, the parking fund can make the debt service payment, maintain a cash reserve, fund operations, and continue repair and maintenance on existing ramps and parking lots.

If the parking division can handle the debt on their own, why are we using the 2nd Penny as collateral?

Misconception #5: The investors in this project are being kept secret

Reality: The public portion of the ramp is being financed with bonds that will be sold on the open market.  The private portion will be financed by investors and banking institutions that the developer must obtain.  When we enter partnerships with private firms, award bids for major road and sewer projects, or enter into contracts with private entities, we know who the winning firm is.  However, we do not know all of the investors, shareholders, or part-owners in those entities.  This is not something we obtain as a matter of course.  The city does not and will not know who the investors are in the private portion.  The city cannot keep something secret that it doesn’t know itself.

I can partially agree with Greg on this one and I understand his argument to an extent. The difference is 1) we are subsidizing this developer by at least $6 million on this project unlike a road project 2) Of the investors listed (4 guarantors) one of them is contesting $200K in fines from OSHA for the Copper Lounge collapse. I guess I’m more concerned about the liability of Mr. Hultgren than I am of the UNKNOWN investors.

Misconception #6: The City is paying for private development

Reality: The development agreement which runs over 100 pages stipulates in very specific detail who is responsible for what.  The city will construct the ramp, and the private entity will construct their private portion.  The developer is paying a portion of the storm drainage work, which both the ramp and private development will benefit from.  The developer is paying for the incremental share of the cost for the foundation which must be larger to support the hotel on top of the parking ramp.  The city is not paying or subsidizing the private development.

While it may be true that the developer is sharing ‘some’ costs, it is a very big stretch to say they are sharing all of the soft costs, because they are not (that has already been admitted by councilor Neitzert). It’s obvious in the price tag of this project and the number of spaces we are getting that we are paying a much bigger share of the ramp than what we should be. He can call it whatever he wants to, but I call that subsidizing the project.

Misconception #7: We are building a ramp for a private developer

Reality: All of the parking spaces will be publicly owned.  The developer will lease spaces like anyone else – at market rate.  The developer does not get any free or reduced price spaces.  The public will be able to lease or use spaces in this ramp, because they are owned by the city.

Not sure if this has ever been a misconception or even a concern. It’s a given. The concern is we are not getting enough (public) spaces for what we are paying.

Misconception #8: We are building a foundation for a private developer

Reality: The developer is paying for their share of the foundation, specifically the increased cost of the foundation to support the hotel on top of the ramp.

Can we see those numbers broken down? While I think they may be kicking in a portion, I don’t think they are truly sharing 50% of those costs. As I mentioned above, the high price tag for this ramp blatantly shows we are subsidizing either the developer or the construction company, and my money is on the developer.

Misconception #9: The developer is paying $1,041 dollars a month to lease our land

Reality: The development agreement is not a month to month lease and the developer is not obtaining exclusive use of the parcel.  It is a lump-sum payment based on current market value and appraisal for the rights to lease the air above the ramp and the portion of our city property in front of the ramp where the private commercial development will sit.  The appraisal takes several factors into account including the fact that the city is still able to use the parcel to its fullest potential for a parking ramp and the increased cost for the developer to build on top of a structure instead of bare ground.  The city will receive 1 million dollars in three portions before, during, and upon completion of the private development.  This lump sum payment takes into account the cost of the increased foundation that must be built to support the hotel and the fair market value of the air rights and partial use of the parcel in front of the parking ramp.

If you do the math, the lease payment does come to $1,041 per month. But that is neither here nor there when you look at the bigger deal. This is the first time the city has gone into a lease agreement like this of a one-time payment for 80 years. Not only is it unusual and poorly negotiated by the city, by allowing this kind of lease to be setup we are setting a precedent for other private businesses that want to lease from the city. I can here it already, “I want the Legacy lease deal.”

Misconception #10: We are only getting 390, 270, or X parking spaces

Reality: The ramp is projected to have 525 spaces.  All of the current spaces on the surface lot we are building on will be replaced with spaces in the ramp.  While the net increase in spaces will be about 390 (525 – 135 current surface parking spaces), the total number of spaces is 525.

So what was the misconception?

Misconception #11: We are not building enough spaces because we are allowing a developer to build on top of our ramp

Reality: We are building enough spaces to satisfy projected demand for the next decade.  Regardless of whether something is built on top of our ramp or not, we would not build any higher than we are building our ramp.  We also cannot go any farther horizontally.  Even if there was no private development, we would not build the ramp any larger or higher.

We are not building enough spaces for the value we are getting. But that has nothing to do with the size of the lot or the height of the ramp, it has to do with this NOT being the right plan. We should be getting 600 Public Parking spots for around $13-15 million. Instead we are getting 2/3rds that for $20 million. Having this partnership with a private developer is actually detrimental to our parking needs downtown. We would be better off and get more value and space building the ramp on our own. The city’s job, especially with an enterprise fund (sewer/water/parking) is to provide a service from a fee/tax. It is not the responsibility of an enterprise fund to subsidize private economic development. One of the reasons a partnership like this has probably never been done before, because it simply isn’t a good deal for the taxpayers.

Misconception #12: We are paying twice the national average for this parking ramp

Reality: The price for this ramp is approximately $26,000 per space using the standard construction cost only number.  The national median cost of a parking ramp per space is $20,000.  The standard median parking ramp for purposes of comparison is a basic bare bones ramp.  Our cost is slightly more because we are adding features and amenities either by code requirement (fire suppression systems) or for user comfort and increased service levels (example: wider drive aisles and parking spaces).  The newspaper article that stated this ramp would cost twice the national median price was based on an apples-oranges comparison of our total project cost (including construction, site prep, financing, debt reserve, architectural, engineering, and other costs) to the national median cost which includes ONLY the construction cost.

When San Franciso and LA can build EARTHQUAKE proof parking ramps for cheaper than we can, you have to question the price tag. As I said above, it isn’t a misconception, it’s pretty obvious with all these extra soft costs, etc., we are subsidizing the building of the hotel AND building them a Cadillac parking ramp. With the mention of the fire suppression system my guess is that the hotel’s portion of the ramp will be enclosed and heated. Still waiting for them to spring this on us, of course, after the contract is approved.

Like I said, many of the councilors, the mayor and his staff are missing the big picture on this project. It’s too damn expensive, it doesn’t provide enough public parking and we are signing the contract with a person who is a major legal liability. Argue about foundations and investors all you want. The simple fact is we are getting HOSED on this deal.

Sioux Falls City Councilor Neitzert on the EC siding settlement

Greg goes into great detail explaining the settlement;

The recent events center settlement revealed that we received $485,004 in cash and forgiveness of bills owed to the contractors. The other $514,996 of the settlement was in the form of a write-down of the ‘contractor contingency’ which is a block of money that the owner (the City) allows the contractor (Mortenson) to access during construction to cover eventualities out of the control of the contractor (i.e. a subcontractor walks off the job, raw material prices spike, etc). At the end of the project, there was $1,524,402 left in the Contractor Contingency fund. Note this is OUR money (it never went to the contractor – it was in our bank account). At the end of the project, industry documents state, and in fact our contract states, that we retain that unused contingency. Now the city asserts it is not ‘our money’ because the contractor could access it. They assert that per the contract, if we were to find a ‘latent’ (hidden and not seen but NOT based on contractor negligence or fraud) defect within the 10 year statute of repose (time limit in South Dakota to find a defect that was hidden and go after the contractor) that they would have the right to access the contractor contingency fund to fix it.

Greg finishes up by saying this;

To be clear I have found no evidence of corruption or malfeasance, at best it was only an error in judgement/bad decision. It may not have even been that.

I disagree, I have felt there should be a Federal investigation into the entire EC building process. I also don’t agree it was an error in judgement. I think the mayor knew what was going on and purposely ignored it out of selfishness to get the project done on time and under budget, which will cost us more in the long run if extensive repairs need to be made.

Why do I think it wasn’t just a bad decision? Because most people in leadership who have integrity and ethics ADMIT to those bad decisions and apologize instead of continuing to lie. And the lies continue to pile up.

Greg did do a fantastic job of explaining the issue, and by NO means he is sugar coating the events.

As for the study that is supposed to happen, I get the feeling more and more that the city is going to have a tough time finding someone willing to point the finger at an internationally acclaimed contractor for bad work. And even if they do, there isn’t much we can go after Mortenson for. As Greg pointed out, it was clearly the adminstration’s fault for allowing the work to be done to begin with. The company that does the study will essentially be asking us to pay them for a conclusion that will put taxpayers on the hook for the repairs. Would you want that job?

I think a group of volunteer local contractors should be putting an advisory report together instead. I know, pie in the sky.

Sioux Falls City Councilor Neitzert posts timeline of siding issue on FB

As I pointed out on Thursday, it seems they new for a long time that the siding was not a good idea, but installed it anyway. Greg puts out a great time line of the events leading up to the settlement. (DOC: Events Center Timeline)

From Greg:

One of the biggest questions out of the Events Center metal panels issue is – what happened? I’m not sure we will ever know completely. However to try to add some clarity I have created a timeline of events. This timeline is based solely on public records and no inside knowledge or privileged information. As noted in the document it is believed to be accurate but some facts are not independently verified in other words there was only one source such as a statement by one of the players in a press release. All supporting source documents are publicly available. I think it answers some questions but it certainly raises more. In the end I don’t think it’s about beating people up or Monday morning quarter backing for the sake of second guessing, it’s about trying to learn from any mistakes so we can avoid them on the next big project.

UPDATE: Greg will be a guest on Patrick Lalley’s show on Monday, at 4:15. Oct 16, KSOO AM 1000.

Sioux Falls City Councilor Greg Neitzert on SE Podcast

Greg talks about many topics including the stupidity of the 50% threshold of a council election.

Thank you to the Neitzert Family

Besides the Mayor and his wife, Greg and his wife Jennifer were the only elected city officials to donate to the Levitt Pavilion. I know the councilors don’t receive nearly enough money for the job they do, so it is always nice to see when they donate to local charities (and most of them do). Essentially giving something back to the community from the small salary they receive.

Thank You.

The donors; LevittShellDonorsVolunteers

Can you protest an Annexation in Sioux Falls?

Citizens asked at the first annexation meeting how they could try to protest or stay out if the city tried to forcibly annex them in.  A reader also asks this on your blog. Here is the answer Councilor Neitzert I was able to get.
If a landowner or group of them object to a FORCED annexation (city initiated) they have a few legal options (three specifically below).
1.  Put the resolution of annexation passed by the city council on the ballot.  This would be very similar to what happened with Walmart, Shape Places, and almost with the administration building.  The only difference is the 5% of registered voters who have to sign the petition are the sum of all of those in Sioux Falls plus all of those in the newly annexed area, so if there were 120,000 registered Sioux Falls voters, and 100 registered voters in a newly annexed area, there would need to be 5% of 120,100 registered voter signatures on a petition collected by 20 days after publication of the resolution.  That would put the question on the ballot and there would have to be an election.  That process is explained here:
SDCL 9-4-4.5.   Petition for submission of annexation resolution to voters. The required number of voters residing in the combined area of the municipality and special annexation precinct may file within twenty days after the publication of the annexation resolution a petition with the municipal finance officer, requiring the submission of the annexation resolution to a vote of the voters of the combined area of the municipality and special annexation precinct for its rejection or approval.
SDCL 9-4-4.6.   Contents of referendum petition–Signatures–Verification. The petition shall contain the title of the resolution or the subject of the resolution and the date of its passage. The petition shall be signed by at least five percent of the registered voters residing in the combined area of the municipality and the special annexation precinct established pursuant to § 9-4-4.8. The percentage shall be based on the number of voters in the municipality at the last preceding general election. Each voter shall add to the voter’s signature the voter’s place of residence, including street and house number, if any, and the date of signing. The referendum petition shall be verified in the same manner as a petition to initiate a law except that the person verifying shall state that each person signing the petition is a resident and registered voter of the municipality or special annexation precinct. No signature on the petition is valid if signed more than six months prior to the filing of the petition.
2.  After a resolution to annex goes into effect, and a group is now IN the city, they can attempt to petition OUT.  Note that this is NOT the same as a zoning protest petition where a group of landowners can force the council to revote on the same ordinance (like the Brett apartment rezone).  This is after the original resolution has passed and gone into effect.  If there were 75% of landowners of equity and registered voters of a block that was annexed, they can force the council to vote on a resolution to exclude (remove) them from the city.  That vote is a simple majority vote of the council.  If the council does not vote to remove them from the city, state law says they can bring that to circuit court (see SDCL 9-4-8 and 9-4-9 below).  Another way to take a group out of the city is by a two-thirds vote of the city council, which would be unlikely if they had just forcibly annexed the same group.
SDCL 9-4-6. Exclusion of territory from municipality on petition or by vote of governing body
Upon a two-thirds vote of the governing body, or on petition in writing signed by not less than three-fourths of the legal voters and by the owners of not less than three-fourths in value of the property in any territory within any municipality being upon the border thereof, the governing body may by resolution exclude the territory from the municipality. However, if all the land sought to be excluded is more than one-half mile from any platted portion of the municipality, the petition must be signed by the owner only.
SDCL 9-4-7. Publication of petition for exclusion of territory
No final action shall be taken by the governing body upon any petition presented in pursuance of the provisions of § 9-4-6 until notice of the presentation of such petition has been given by the petitioners by publication at least once each week for two successive weeks.
SDCL 9-4-8. Petition to circuit court for exclusion of territory after refusal by governing body
Upon the failure of the governing body to grant the request contained in a petition presented in accordance with the provisions of §§ 9-4-6 and 9-4-7, for thirty days after the last publication of the notice or upon a refusal to grant such request, the petitioners may present their petition to the circuit court of the county in which such municipality or the greater portion of it is situated, by filing such petition with the clerk of courts.
SDCL 9-4-9. Service of notice of petition to circuit court–Hearing at term or in vacation
Notice of filing pursuant to § 9-4-8 shall be served by the petitioners upon the mayor or president of the Board of Trustees, as the case may be, together with a notice of the time and place when and where a hearing will be had upon such petition, at least ten days before the date of such hearing.
The hearing on the petition may be had by the court at a regular or special term or in vacation.
SDCL 9-4-10. Court order for exclusion of territory–Dismissal of petition
If upon the hearing the court shall find that the request of the petitioners ought to be granted and can be granted without injustice to the inhabitants or persons interested, the court shall so order.  If the court finds against the petitioners, the petition shall be dismissed at the cost of the petitioners.
3.  Some other sort of action in circuit court objecting to some legal aspect of the forced annexation or the process in which it was done.

Coffee with Legislature AND Council

The lawmaker, the troublemaker and the deal maker

It was a nice surprise to not only see councilors Neitzert and Stehly, but legislators Michael Clark and Greg Jamison were also in attendance talking to constituents today and the Coffee with Council event at HyVee. Jamison and I had a good conversation about repealing IM 22 (we didn’t solve much though) He thinks (mostly his caucus) we should repeal it ASAP, I told him that we should let the Supreme Court address it, and further more, Judge Barnett has already halted the law, so what’s the hurry for repeal until the SC weighs in? I also I have a problem with the legislature making it’s own rules when it comes to ethics.

Coffee with the Council – THIS SATURDAY!

Coffee with Council Members – Erickson, Stehly, and Neitzert

What: Come and have coffee with three (3) of your Sioux Falls City Council Members.

When: Saturday January 28, 2017 from 9:00 a.m. – 10:30 a.m.

Where: Hy-Vee Food Store, 1900 S. Marion Road (W 26th St and Marion Rd), Cafeteria just inside the east entrance

Who: Councilors Christine Erickson (At-Large), Theresa Stehly (At-Large), and Greg Neitzert (Northwest District)

Why: Come and engage three of your Sioux Falls City Councilors to discuss your thoughts, ideas, and concerns!

South DaCola 2016 year in review (Part I)

art-maze-mower-lrArtMaze, one of the better parts of Sioux Falls life in 2016

2016 has been a rough year for citizen activism. While it has been up and down here in Sioux Falls with many successes and failures to boot, it seems Washington DC has gone into full collapse as we allowed racist, sexist, hillbillies to elect our president.


But locally there were three things that stood out;

• Governor Daugaard claiming that voters were ‘hoodwinked’ into voting for IM 22, then getting the Pierre (in)justice system to go along with it. Funny how for over 40 years voters have been voting his party into power, and no word about ‘hoodwinking’ but once that corrupt power will be challenged, all the voters are idiots. As one official told me that used to work for Dennis, it’s not the public that are idiots, it’s Dennis. And his idiocy has been shining through.

• The South Dakota Democratic Party’s bottom completely fell out, and the people in charge patted themselves on the back. Insanity I tell you! Insanity!

• But one of the greatest achievements of the year is the Sioux Falls City Council’s change of power. The four new councilors have been flexing their muscles with a little help from Councilor Erickson, and while they have had a few missteps to start out, they have been learning from the battle scars. While ‘leadership’ of the council (Rolfing and Kiley) seem to be on a two man mission to rubberstamp all things Huether, shut down public input, and concoct false ethics charges against a fellow councilor (until they got caught lying like the snakes they are) they are becoming more and more in check. The city council has many big plans for 2017, and I have a feeling their agenda will push through easily as our lame duck mayor melts.

Let’s take a look at some the finer high and low points of 2016;

• The Huether Tennis center continues to block parking from other event attendees at the Sanford Sports complex though they basically stole $500K from taxpayers for the facility. Throughout the year there was several reports on cones and signs blocking the lot with not cars in it. But hey Mike’s Bride won an award this year and seemed surprised she did, without commenting that her check to the organization that gave the award wasn’t returned.

• The Sioux Falls City Council leadership and mayor’s HR department pulled a military retiree out of their asses for city clerk, a person who will be in charge of our city elections and hasn’t been registered to vote for years. He also proved his knowledge of official stamps when he stamped a petition without even bothering to read it. While Mr. Greco has gotten better over the year, the city clerk position should not be a $80K+ a year job as an apprentice, sadly being trained by one of his assistant clerks who has ten times the qualifications and applied for the position but was turned down. I’m sure it had nothing to do with the council chair’s view of women in the work place.

• Speaking of letting the mayor’s HR department and Leadership’s Mutt and Jeff pick the next internal auditor, the council barked loud enough that they did not want another ‘Greco’ pick. Not sure if the barking worked, but the person who was set to take the job saw the writing on the wall and turned it down. Hopefully the person who ultimately gets the position won’t be turned down because they shave their legs.

• The city continues to blow money on the Winter Wonderland Display, but the way the mayor has been cutting budgets these days, I expect next year’s display to be a couple of homeless barrel fire pits, sponsored by the Dudley House of course.

• After posting about the ridiculous corporate like raises the mayor has been giving to his management team, he turns around and still screws the minions with dismal raises again this year. I think in a special note to the city employees on their Christmas paystub he wrote, “I don’t care.”

• The city continues the FREE condom distribution program at area bars, and for some reason Monk’s is always emptied the quickest. Coincidence that is also a favorite watering hole of city managers . . .

• The Tuthill shooting case becomes ‘inactive’ and a tree branch shadow gets off scott free.

• The Erp wrongfully calls out local massage therapists as prejudice because they pointed out the ‘shower massages’ that were taking place around town. Apparently someone got a bad fortune cookie that day.

• The car rental tax and BID tax grabby-grabby fails in Sioux Falls, but the state legislature passes one of the most idiotic tax increases ever so our teachers are now just tied for last instead of dead last in pay. Out hoodwinking governor already has plans to rob the pot only one year after its passage.

• Hartford’s city government was in a state of collapse. Who really cares?

• The Levitt Pavilion is moving forward in Sioux Falls. It will be nice watching outdoor concerts sitting in the grass while battery acid is boiling beneath our asses.

• The Boulevard ordinance changes went into effect. Now stop worrying about rocks and plant a garden.

• The Washington Pavilion got a change of leadership after Darrin Smith takes over as President. So far he has only eliminated one director, but I hear the blood-letting has just begun. Now let’s throw another couple of million at the place to fix the poor construction to begin with. That will never happen with the Events Center . . .

• The Events Center cracks down on outside snacks and guns at events. We are all now safe from cheap fat people shooting us, but not in the parking lot.

• The Pottie Room war starts in Pierre and is guaranteed to return in 2017.

• A state legislator calls transgender people ‘twisted’. Now I’m struggling with what word to use describing our state legislators?

• A city council candidate throws a hissy fit over a post I wrote about his wife’s involvement with the Jesus plows and after threats to my employer I pull the post. He ends up taking last place in the at-large race. How’s Jesus working out for you now?

• Due to health reasons, Kermit Staggers decides not to run for a 4th term on the city council. His endorsement of Stehly puts her over the top.

• One of the youngest candidates in city history runs for city council. I apologize to Briggs for all the shitty things I said about him during the campaign.

• The Argus Leader sues the city for the details in the secret events center siding settlement. The Argus loses the first round but it is headed to the SD Supreme Court.

• On a similar note, the SON neighborhood is also awaiting a judgement in their Walmart suit with the SD Supreme Court.

• While our Sioux Falls City Council approves the DAPL through Sioux Falls, it takes thousands of protesters in ND to actually stop it. Too bad our city council chair doesn’t understand how to vote.

• The Mayor and Q-Tip Smith screwup the DT parking ramp development by flapping their traps to soon, and the council later on in the year returns the favor and defunds the ramp all together for 2017. I still think the fiasco is what got Smith to seek refuge at the Pavilion.

• City officials throw a hissy-fit over Bruce’s camera at a city meeting we were invited to by then city councilor Kenny Anderson. Looking back on it now, I just chuckle.

• Former city councilor Dean Karsky and now commissioner elect has become the official endorser in Sioux Falls.

• Bruce and I do a presentation on voter turnout in Sioux Falls at Democratic Forum and one of the mayor’s buddy developers in Sioux Falls tries to shut us down. When he fails, he walks out. Another casualty to transparency.

The Fabulous Four on Knobe, Monday at 4:15.


Sioux Falls City council members Neitzert, Selberg, Stehly & Starr will discuss their time on the council and their ‘wish list’ for 2017.